Yum! Brands Reports Second-Quarter Results
+6% GAAP Operating Profit Growth and +10% Core Operating Profit Growth
Taco Bell Same-Store Sales Growth +5%; KFC Unit Growth +8%
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DAVID GIBBS COMMENTS
SECOND-QUARTER HIGHLIGHTS
-
Worldwide system sales grew 3%, excluding foreign currency translation, with
KFC at 2%,Taco Bell at 7% andPizza Hut flat. - Unit count increased 5% including 894 gross new units in the quarter.
-
Robust digital sales of nearly
$8 billion , with digital mix over 50%. - GAAP operating profit grew 6%, and core operating profit grew 10%.
-
Foreign currency translation unfavorably impacted divisional operating profit by
$12 million .
Reported Results |
% Change |
||||
|
System Sales Ex F/X |
Same-Store Sales |
Units |
GAAP Operating
|
Core Operating Profit1 |
KFC Division |
+2 |
(3) |
+8 |
+3 |
+6 |
Taco Bell Division |
+7 |
+5 |
+3 |
+10 |
+10 |
Pizza Hut Division |
Even |
(3) |
+3 |
+4 |
+6 |
Worldwide |
+3 |
(1) |
+5 |
+6 |
+10 |
|
Second-Quarter |
Year-to-Date |
||||
|
2024 |
2023 |
% Change |
2024 |
2023 |
% Change |
GAAP EPS |
|
|
(12) |
|
|
(5) |
Less Special Items EPS1 |
|
|
NM |
|
|
NM |
EPS Excluding Special Items |
|
|
(4) |
|
|
+1 |
1 See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further detail of Core Operating Profit and Special Items. |
|
All comparisons are versus the same period a year ago. |
|
System sales growth figures exclude foreign currency translation ("F/X") and core operating profit growth figures exclude F/X and Special Items. Special Items are not allocated to any segment and therefore only impact worldwide GAAP results. See reconciliation of Non-GAAP Measurements to GAAP Results within this release for further details. |
|
Digital system sales includes all transactions at system restaurants where consumers utilize ordering interaction that is primarily facilitated by automated technology. |
KFC DIVISION
|
Second-Quarter |
Year-to-Date |
||||||
|
|
|
%/ppts Change |
|
|
%/ppts Change |
||
|
2024 |
2023 |
Reported |
Ex F/X |
2024 |
2023 |
Reported |
Ex F/X |
Restaurants |
30,689 |
28,500 |
+8 |
N/A |
30,689 |
28,500 |
+8 |
N/A |
System Sales ($MM) |
8,226 |
8,298 |
(1) |
+2 |
16,354 |
16,355 |
Even |
+3 |
Same-Store Sales Growth (%) |
(3) |
+13 |
NM |
NM |
(3) |
+11 |
NM |
NM |
Franchise and Property Revenues ($MM) |
405 |
416 |
(3) |
Even |
802 |
828 |
(3) |
(1) |
Operating Profit ($MM) |
334 |
326 |
+3 |
+6 |
647 |
631 |
+3 |
+6 |
Operating Margin (%) |
46.6 |
47.7 |
(1.1) |
(0.4) |
48.0 |
46.0 |
+2.0 |
+2.7 |
|
Second-Quarter (% Change) |
Year-to-Date (% Change) |
||
|
International |
|
International |
|
System Sales Growth Ex F/X |
+3 |
(7) |
+5 |
(7) |
Same-Store Sales Growth |
(3) |
(5) |
(2) |
(6) |
- KFC Division opened 598 gross new restaurants across 57 countries.
-
Foreign currency translation unfavorably impacted operating profit by
$10 million .
KFC Markets1 |
Percent of |
System Sales Growth Ex F/X |
|
Second-Quarter (% Change) |
Year-to-Date (% Change) |
||
|
27% |
+5 |
+7 |
|
15% |
(7) |
(7) |
|
11% |
+9 |
+8 |
|
10% |
(10) |
(8) |
|
7% |
+3 |
+4 |
|
7% |
+20 |
+21 |
|
6% |
(3) |
(2) |
|
6% |
(11) |
(8) |
|
5% |
+10 |
+10 |
|
2% |
+8 |
+8 |
|
2% |
+5 |
+4 |
|
2% |
+9 |
+10 |
1Refer to investors.yum.com/financial-information/financial-reports/ for a list of the countries within each of the markets. |
2Reflects Full Year 2023. |
TACO BELL DIVISION
|
Second-Quarter |
Year-to-Date |
||||||
|
|
|
%/ppts Change |
|
|
%/ppts Change |
||
|
2024 |
2023 |
Reported |
Ex F/X |
2024 |
2023 |
Reported |
Ex F/X |
Restaurants |
8,565 |
8,320 |
+3 |
N/A |
8,565 |
8,320 |
+3 |
N/A |
System Sales ($MM) |
4,017 |
3,760 |
+7 |
+7 |
7,614 |
7,224 |
+5 |
+5 |
Same-Store Sales Growth (%) |
+5 |
+4 |
NM |
NM |
+3 |
+6 |
NM |
NM |
Franchise and Property Revenues ($MM) |
234 |
218 |
+7 |
+7 |
444 |
419 |
+6 |
+6 |
Operating Profit ($MM) |
250 |
228 |
+10 |
+10 |
458 |
432 |
+6 |
+6 |
Operating Margin (%) |
37.5 |
36.8 |
0.7 |
0.7 |
36.3 |
36.2 |
0.1 |
0.1 |
- Taco Bell Division opened 56 gross new restaurants across 11 countries.
-
Taco Bell
U.S. system sales grew 7% andTaco Bell International system sales excluding foreign currency grew 4%. -
Taco Bell
U.S. same-store sales grew 5% andTaco Bell International same-store sales declined 1%. - Company-owned restaurant margins were 25.6%, flat year-over-year.
PIZZA HUT DIVISION
|
Second-Quarter |
Year-to-Date |
||||||
|
|
|
%/ppts Change |
|
|
%/ppts Change |
||
|
2024 |
2023 |
Reported |
Ex F/X |
2024 |
2023 |
Reported |
Ex F/X |
Restaurants |
19,864 |
19,242 |
+3 |
N/A |
19,864 |
19,242 |
+3 |
N/A |
System Sales ($MM) |
3,140 |
3,201 |
(2) |
Even |
6,307 |
6,537 |
(4) |
(2) |
Same-Store Sales Growth (%) |
(3) |
+4 |
NM |
NM |
(5) |
+5 |
NM |
NM |
Franchise and Property Revenues ($MM) |
148 |
149 |
Even |
+1 |
296 |
304 |
(3) |
(1) |
Operating Profit ($MM) |
94 |
91 |
+4 |
+6 |
187 |
195 |
(4) |
(2) |
Operating Margin (%) |
39.3 |
37.3 |
2.0 |
2.5 |
39.2 |
39.3 |
(0.1) |
0.3 |
|
Second-Quarter (% Change) |
Year-to-Date (% Change) |
||
|
International |
|
International |
|
System Sales Growth Ex F/X |
Even |
(1) |
(1) |
(3) |
Same-Store Sales Growth |
(4) |
(1) |
(6) |
(3) |
- Pizza Hut Division opened 236 gross new restaurants across 30 countries.
-
Foreign currency translation unfavorably impacted operating profit by
$2 million .
Pizza Hut Markets1 |
Percent of |
System Sales Growth Ex F/X |
|
Second-Quarter (% Change) |
Year-to-Date (% Change) |
||
|
41% |
(1) |
(3) |
|
18% |
+10 |
+4 |
|
13% |
(5) |
(5) |
|
12% |
(6) |
(5) |
|
6% |
+1 |
+2 |
|
5% |
(6) |
(6) |
|
3% |
+7 |
+5 |
|
2% |
+4 |
+1 |
1Refer to investors.yum.com/financial-information/financial-reports/ for a list of the countries within each of the markets. |
2Reflects Full Year 2023. |
HABIT BURGER GRILL DIVISION
- The Habit Burger Grill Division opened 4 gross new restaurants this quarter.
- The Habit Burger Grill Division system sales declined 1% with same-store sales declining 6%.
OTHER ITEMS
- See reconciliation of Non-GAAP Measurements to GAAP results within this release for further detail of Special Items by financial statement line item including the impact of Special Items on General and administrative expenses.
-
In
June 2024 , the Company completed a strategic transaction to transfer certain rights related to trademarks of the Jeno’s and Telepizza brands inColombia andChile to restaurant operatorFood Delivery Brands, S.A. As a result of the transaction, approximately 120 Jeno’s and Telepizza branded restaurant units were removed from Pizza Hut’s global unit count. -
Disclosures pertaining to outstanding debt in our
Restricted Group capital structure will be provided at the time of the filing of the second-quarter Form 10-Q.
CONFERENCE CALL
Yum! Brands, Inc. will host a conference call to review the company's financial performance and strategies at
The call will be available for playback beginning at
The webcast and the playback can be accessed by visiting Yum! Brands' website, investors.yum.com/events-and-presentations and selecting “Q2 2024 Yum! Brands, Inc. Earnings Call.”
ADDITIONAL INFORMATION ONLINE
Quarter-end dates for each division, restaurant count details, definitions of terms and
FORWARD-LOOKING STATEMENTS
This announcement may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend all forward-looking statements to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by the fact that they do not relate strictly to historical or current facts and by the use of forward-looking words such as “expect,” “expectation,” “believe,” “anticipate,” “may,” “could,” “intend,” “belief,” “plan,” “estimate,” “target,” “predict,” “likely,” “seek,” “project,” “model,” “ongoing,” “will,” “should,” “forecast,” “outlook” or similar terminology. These statements are based on and reflect our current expectations, estimates, assumptions and/ or projections, our perception of historical trends and current conditions, as well as other factors that we believe are appropriate and reasonable under the circumstances. Forward-looking statements are neither predictions nor guarantees of future events, circumstances or performance and are inherently subject to known and unknown risks, uncertainties and assumptions that could cause our actual results to differ materially from those indicated by those statements. There can be no assurance that our expectations, estimates, assumptions and/or projections, including with respect to the future earnings and performance or capital structure of Yum! Brands, will prove to be correct or that any of our expectations, estimates or projections will be achieved.
Numerous factors could cause our actual results and events to differ materially from those expressed or implied by forward-looking statements, including, without limitation: food safety and food- or beverage-borne illness concerns; adverse impacts of health epidemics, deterioration in public health conditions or the occurrence of other catastrophic or unforeseen events; the success of our concepts’ franchisees; the success of our development strategy; anticipated benefits from past or potential future acquisitions, investments, other strategic transactions or initiatives, or our portfolio business model; our significant exposure to the Chinese market; our global operations and related exposure to geopolitical instability; foreign currency risks and foreign exchange controls; our ability to protect the integrity or availability of IT systems or the security of confidential information and other cybersecurity risks; compliance with data privacy and data protection legal requirements; our ability to successfully implement technology initiatives, including utilization of artificial intelligence; our increasing dependence on digital commerce platforms; the impact of social media; our ability to protect our trademarks or other intellectual property; shortages or interruptions in the availability and the delivery of food, equipment and other supplies; the loss of key personnel, labor shortages and increased labor costs, including as a result of state and local legislation related to wages and working conditions; changes in food prices and other operating costs; our corporate reputation, the value and perception of our brands and changes in consumer preferences and wellness trends; evolving expectations and requirements with respect to social and environmental sustainability matters; adverse effects of severe weather and climate change; pending or future litigation and legal claims or proceedings; changes in, or noncompliance with, legal requirements; tax matters, including changes in tax rates or laws, impositions of new taxes, tax implications of our restructurings, or disagreements with taxing authorities; changes in consumer discretionary spending and macroeconomic conditions, including inflationary pressures and elevated interest rates; competition within the retail food industry; risks relating to our level of indebtedness. In addition, other risks and uncertainties not presently known to us or that we currently believe to be immaterial could affect the accuracy of any such forward-looking statements. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty.
The forward-looking statements included in this announcement are only made as of the date of this announcement and we disclaim any obligation to publicly update any forward-looking statement to reflect subsequent events or circumstances. You should consult our filings with the
Yum! Brands, Inc., based in
Category: Earnings
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Source: Yum! Brands, Inc.